Is the crypto winter over?

[ph1l]

What doesn't quite add up is the increase in AUM for the new ETFs was greater than the decrease in AUM for GBTC. Why didn't that excess demand positively impact the price of bitcoin?

ETF shares could have been created from existing bitcoin.

Yes, Bitcoin ETF shares can be created from existing Bitcoin. When investing in a Bitcoin ETF, you're essentially buying shares in a pool of Bitcoin³. This process involves the creation of new ETF shares to match the demand³. Conversely, when you sell your shares, they are redeemed, effectively adjusting the total number of ETF shares in circulation³.

Unlike Bitcoin itself, which can only be bought and sold along the blockchain, Bitcoin ETFs can be traded by retail investors through regular brokerage accounts¹. This opens up the crypto market to a broader world and simplifies the process for most Americans who have brokerage accounts¹.

However, it's important to note that the SEC only approved cash creations and redemptions, meaning the ETF will need to bear the costs of buying and selling Bitcoin when ETF shares are created or redeemed².

For example, Grayscale was approved to convert its existing Bitcoin trust into an ETF, creating the world's largest Bitcoin ETF with more than $28 billion in assets under management⁴.

Please note that investing in Bitcoin ETFs involves risks and should be done carefully. It's always a good idea to consult with a financial advisor before making investment decisions.

Source: Conversation with Bing, 1/13/2024
(1) Bitcoin ETFs Explained: What Are They & How Do They Work? - CoinDesk. https://www.coindesk.com/learn/2024/01/11/bitcoin-etfs-explained-what-are-they-how-do-they-work/.
(2) SEC Approved Bitcoin ETFs: Here's How They Work & How to Start Trading. https://www.businessinsider.com/per...-etfs-approved-by-the-sec-how-to-trade-2024-1.
(3) Spot Bitcoin ETFs Are Here. Should You Invest? | Morningstar. https://www.morningstar.com/etfs/spot-bitcoin-etfs-are-here-should-you-invest.
(4) US bitcoin ETFs see $4.6b in volume in first day of trading. https://gulfnews.com/business/marke...olume-in-first-day-of-trading-1.1705157570382.

 

[johnarb]

What doesn't quite add up is the increase in AUM for the new ETFs was greater than the decrease in AUM for GBTC. Why didn't that excess demand positively impact the price of bitcoin?

Inflows were used for OTC trades which do not affect the price, the OTC supplies will run out soon™

Gbtc funds will clear in T+1 +2 +3 and imo will re-buy other bitcoin ETF's adding to inflows, so things could stabilize as early as end of next week. Monday is a holiday, though

Scaramucci thinks 6-8 days

We need consistent funds inflows from the ETF's and eventually the OTC supplies will run out. I reckon a month of steady inflows will do it

View attachment 331527

Funny you say this cause I just saw this post today...

View attachment 331530

 

[jbusse]

The OTC supply -- seems tantamount to a very large ask size. Is it largely miner inventory?

 

[johnarb]

The OTC supply -- seems tantamount to a very large ask size. Is it largely miner inventory?

OTC desks (Coinbase has a big operation for their institutional clients, the fees are tiny, it's part of their earnings report) are both bid and ask

and miners do sell otc but miners are not always selling, they are not the best traders, usually hoarding during bull market and selling during bear market, many were on the brink of bankruptcy this past bear market cycle, good example is MARA down over 90% on the stock market from $52 Oct/2021 to $3.42 Dec/2022, now doing well at the start of this bull market

. Also newly minted bitcoins used to carry a premium and may still do, no tainted history such as darknet, or hackers ransomware, etc

OTC trades big chunk of bitcoins for sale sell for a premium, otherwise, they'll just trade it on the open market

bitcoin (OG) whales are solicited by the OTC desks for supplies, so I heard/read

 

[schizo]

It chopped all day, but looks like it wants to go higher now. Does any non-chartist out there wanna take a stab on where the next TP will be?

 

[semperfrosty]

OTC desks (Coinbase has a big operation for their institutional clients, the fees are tiny, it's part of their earnings report) are both bid and ask

and miners do sell otc but miners are not always selling, they are not the best traders, usually hoarding during bull market and selling during bear market, many were on the brink of bankruptcy this past bear market cycle, good example is MARA down over 90% on the stock market from $52 Oct/2021 to $3.42 Dec/2022, now doing well at the start of this bull market

. Also newly minted bitcoins used to carry a premium and may still do, no tainted history such as darknet, or hackers ransomware, etc

OTC trades big chunk of bitcoins for sale sell for a premium, otherwise, they'll just trade it on the open market

bitcoin (OG) whales are solicited by the OTC desks for supplies, so I heard/read

Explains the drop in volume I couldnt understand too.Large players moving to OTC.

Will be interesting to see if the drop spooks the ETF investors or entices them.For me,I know I'd rather be jumping in after 5 or 10% drop.See how it plays out,could help the cause.

 

[johnarb]

It chopped all day, but looks like it wants to go higher now. Does any non-chartist out there wanna take a stab on where the next TP will be?

$50k for sure, then $60k

Explains the drop in volume I couldnt understand too.Large players moving to OTC.

Will be interesting to see if the drop spooks the ETF investors or entices them.For me,I know I'd rather be jumping in after 5 or 10% drop.See how it plays out,could help the cause.

I doubt it. These new buyers are long term investors (i.e. HNW allocation, retirement accounts, managed accounts by RIA's)

Blackrock Ibit vs Fidelity Fbtc vs others is something to keep an eye on

I do not see Blackrock slowing down at all, the race is to be the number 1 ETF with the biggest AUM, the survival of the product depends on it

I can see Blackrock sales people are probably very active on the golf courses, VIP resorts, country clubs this long weekend pitching this new asset and an allocation is highly recommended

$10 Trillion Blackrock behemoth and with a measly $500M in the first 2 days of a new asset class etf, the best performing asset in the history of mankind

Nope, this is literally a drop in bucket, the floodgates are being released. The sales and marketing department will have plenty of rest later

https://twitter.com/x/status/1746424115068583941

https://twitter.com/x/status/1746150231769547157

 

[semperfrosty]

$50k for sure, then $60k




I doubt it. These new buyers are long term investors (i.e. HNW allocation, retirement accounts, managed accounts by RIA's)

Blackrock Ibit vs Fidelity Fbtc vs others is something to keep an eye on

I do not see Blackrock slowing down at all, the race is to be the number 1 ETF with the biggest AUM, the survival of the product depends on it

I can see Blackrock sales people are probably very active on the golf courses, VIP resorts, country clubs this long weekend pitching this new asset and an allocation is highly recommended

$10 Trillion Blackrock behemoth and with a measly $500M in the first 2 days of a new asset class etf, the best performing asset in the history of mankind

Nope, this is literally a drop in bucket, the floodgates are being released. The sales and marketing department will have plenty of rest later

https://twitter.com/x/status/1746424115068583941

https://twitter.com/x/status/1746150231769547157

Great points JA!

 

[semperfrosty]

Lochness Monster Pattern confirmed.50K imminent.

 

[The_Krakenite]

Lochness Monster Pattern confirmed

LMFAO!